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Liquidating a UAE Free Zone Company
Company Liquidation in the UAE Free Zone is a defined process that entrepreneurs must follow when dissolving their businesses. Assign all aspects of company liquidation and business winding up to a consultant or specialist in the subject to ensure a smooth procedure.
Requirements for company termination may differ from free zone to free zone, but the majority of them will be the same across all free zones.
Clearance certificates required for the liquidation of a UAE Free Zone company
Company Liquidation in the UAE Free Zone is a defined process that entrepreneurs must follow when dissolving their businesses. Assign all aspects of company liquidation and business winding up to a consultant or specialist in the subject to ensure a smooth procedure.
Requirements for company termination may differ from free zone to free zone, but the majority of them will be the same across all free zones.
- Clearance certificate from relevant free zone authority
- Clearance certificate from business unit
- Clearance certificate from all utilities
- Clearance certificate from any related authorities as per the regulated activity
- Clearance for customs
- The company should not have any liabilities
- Cancel all active visas
- Close all corporate bank accounts
- Any assets at the moment of liquidation must be transferred to shareholders or a third party
- Clear all fees and charges for the free zone authorities
- Immigration clearance from the Free Zone Authority
- The company must prepare a resolution of liquidation and engage a licenced liquidator to carry out the operation
- The liquidator must approve the order of action for the business's liquidation and send confirmation that the company has no assets, obligations, or liabilities by preparing a final Audit Report/Liquidation Letter
Requirements for Free Zone Company Liquidation in the UAE
Depending on the business jurisdiction, the Free Zone company liquidation procedure in Dubai consists of the following phases, which the entrepreneur must take to ensure a smooth company liquidation in the UAE.
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Dubai Company Liquidation – Frequently Asked Questions
The timeline can vary based on factors such as the company’s financial complexity and the effectiveness of the liquidation procedure. On average, it takes several months to finish.
No, there are alternative choices, such as mergers and acquisitions or selling the company. However, if you decide to discontinue operations, liquidation is the formal procedure to follow.
During liquidation in Dubai, employees are typically entitled to receive their outstanding dues, including salaries and end-of-service benefits.
The company may need to provide notice or payment instead of notice. Employees could be transferred to another company within the group, subject to agreement, or work permits may be canceled in compliance with regulations.
Legal and fair treatment of employees is essential during this process.
In the majority of cases, a company ends operations when the court imposes compulsory liquidation. The focus switches to debt repayment and asset distribution.
While it is doable, the legal and administrative intricacies make it extremely prudent to seek professional advice. Experts can help make the process more efficient and compliant.